Tally.ERP9 Book @ Rs.450
Share |

Sources Of Law Relating To Income Tax

The law relating to Income Tax is one of the most complicated law of India. A number of different documents cover the various aspects of Income Tax provisions and one has to go through all these documents (sources) to have a through knowledge of it. These documents are known as ‘Sources Of Law Relating To Income Tax’ and are as follows

(1)       Income Tax Act, 1961.

On the recommendation of Law Commission and Direct Taxes Administration Enquiry Committee chaired by Sh. Mahavir Tyagi, a bill was framed. This bill was referred to a select committee and was finally passed in September, 1961. This Act came into force from April 1, 1962 in whole of the country. Income Tax Act, 1961 is a comprehensive Act which consists of 298 sections and many subsections grouped under XXIII Chapters along with XIV Schedules. The Act contains detailed provisions regarding applicability, basis of charge, residential status, heads of income, clubbing provisions, set-off of losses, deductions, exemptions and assessment procedures involving appeals, penalities and filing of return etc.

(2)       Income Tax Rules, 1962.

The provisions contained in Income Tax Act are duly supported by Income Tax Rules, 1962 that help in carrying out the purposes of the Act. These rules are prepared by ‘Central Board of Direct Taxes” (CBDT) by virtue of power granted to it (i.e., Board) under section 295 of the Income Tax Act, 1961. These rules deal with procedural part of the various aspects of Income Tax.

Certain Examples of Income Tax Rules

(i) Rule 3—Valuation of perquisites for calculating ‘Salary income’.

(ii) Rule 6—Prescribed authority for expenditure on scientific research.

(iii) Rule 7—Splitting up of partly agricultural income and partly non-agricultural income.

(iv) Rule 6DD—Cases and circumstances in which payment exceeding’ 20,000 may be made otherwise than by an account payee cheque or account payee bank draft.

These rules are made applicable by way of notification in the Official Gazette of India and are subject to the control of Central Government.

(3)       Annual Finance Act.

Annual Finance Act is an important piece of legislation that updates! amends the Income Tax Act, 1961. It gives effect to the financial proposals of the government for the relevant financial year and is finalised at the beginning of every financial year. It contains

(i) Introduction of new sections to the Income Tax Act, 1961;

(ii) Deletion of certain sections from the Income Tax Act, 1961; and

(iii) Rates of Income Tax for an assessment year, rates of tax for deducted at source for the financial year and rates of advance tax for the relevant financial year.

(4)       Circulars and Clarifications issued by CBDT.

The Indian Central Board of Direct Taxes (CBDT) is the apex institution that regulates the overall administration of the direct taxes (IncOme Tax and Wealth Tax) of the country. Section 119 of the Income Tax Act, 1961 empowers CBDT to issue certain orders, instructions and directions to the revenue department (i.e., Income Tax department) to assist in the interpretation of the law. These orders/instructions/directions are issued in the form of circulars/instructions and are required to be followed by the Income Tax authorities. These circulars clarify the ambiguities in statutory provisions and provide greater ease of administration.

Important Points
            (i)         CBDT circulars are binding on Income tax department officials.
            (ii)        Circulars are not binding on assessee.
            (iii)       Circulars are not binding on CTT (Appeals) and other appellate authorities.

(5)       Judicial Decisions/Case Law.

Judicial decisions are also one of the most important source of Income tax law.

Important Points
            (i)         Any decision given by any High Court shall be applicable in the particular case.

            (ii)        Any decision given by the honorable Supreme Court shall be treated as law applicable throughout the country.

            (iii)       The decision of Supreme Court can be reversed by the Parliament by encasing a law contrary to such decision.
 
More Topics.. @ Tax Concept
Types of Income under Income Tax Act. 1956.
Income Deemed To Be Received In India under I.Tax Act.
Income Which ‘Accrues’ Or ‘Arises’ In India under I.Tax Act.
[Section 9(1)(i)] - Income Arising From Business Connection In India
Income from any property held in India and assets or sources of income located in India
Income from transfer of capital assets situated in India
[Section 9(1)(ii)] - Salaries earned in India
[Section 9(1 )(iii)] - Salaries For Government Service Outside India
[Section 9(1)(iv)] - Dividend paid abroad by Indian Company
[Section 9(1 )(v)] - Income By Way Of Interest
[Section 9(1)(vi)] - Income By Way Of Royalty
[Section 9(1 )(vii)] - Income By Way Of Fees For Technical Services
Agricultural Income [Section 2(1A)] - Definition under I.Tax
Assessment Year [Section 2(9)] - Definations under I.Tax.
Constitutional Provision Governing Taxation in India
Gross Total Income [Section-80B (5) ] - Definations under I.Tax.
Heads of Income [Section-14 ] - Definations under I.Tax.
Income is Taxed in the same Year in which it is earned
Income [Section 2(24)] - Definations under I.Tax.
Person [Section 2(31)] - Definations under I.Tax.
Previous Year [Section 2(34) r.w. Section 3] - Definations under I.Tax.
Sources Of Law Relating To Income Tax
Taxes to be imposed only by Authority of Law
Get Updated ....
 
 
 
 
LIBRARY @ Tax Management
TAX & INVESTMENT GUIDE FOR "NRI"- Non-Resident Indians !
GUIDE & FAQ @ TAX
GRAPHICAL PRESENTATION @ TAX
TIPS & TRICKS @ TAX
MANAGERIAL & FINANCIAL DECISIONS @ TAX
5 GOLDEN RULES OF TAX PLANNING
FAMILY TAX PLANNING
DEDUCTIONS FROM YOUR INCOME
EXEMPTED INCOMES
HUF - FORMATION, MANAGEMENT & TAX PLANNING
COMPUTATION OF GROSS TOAL INCOME
INCOME TAX @ GLANCE
MULTIPLE KNOWLEDGEBASE ON TAX
51 TIPS ON TAX PLANNING
APPEALS UNDER INCOME TAX
ASSESSMENTS
PENALTIES UNDER IT DEPATMENTS
TAX SAVING SCHEMES
TAX READY RECKONER
TAX RATES
PROSECUTIONS UNDER INCOME TAX DEPARTMENT
TAXATION SYSTEM IN INDIA
CHARITABLE & RELIGIOUS TRUST - TAXATION
 
 

Most Popular Topics :

Corporate Tax ( Taxation in Companies)
FAQ on TDS on Salaries
FAQ on Taxable Income
FAQ on Filing of Income Tax Return
Graphical Chat Presentation of Provision of Motor Car / Other Vehicles [Rule 3(2)(A)&(B)]
Tax Amendment at a Glance for Year 2015
'Appeals' Under Income Tax Act. 1961.
'Assessments' Under Income Tax Act. 1961.
List of Exempted Incomes (Tax-Free) Under Section-10
Income Under the Head ' Business and Professions' [Section 28 to 44]
Income Under the Head ' Capital Gain'
Income Under the Head ' House Property '[Section- 22 - 25 ]
Income Under the Head "Salary"
[Section 15-17]
Income Tax on 'Partnership Firms'
PENALTIES Under Income Tax Act. 1961.
Tax Saving Schemes for Individual for AY 2015-2016-Instant Guide
Income Tax Rates / Tax Slabs (AY-2014-2015 & 2015-2016)
"Exempted Incomes" under Income Tax Act.
Charitable & Religious Trust :Formation, Registration, & Taxation
Hindu Undivided Family [HUF] - Formation, Management and Taxation

Most Popular Links :

Clubing of Income Deduction U/s 80C
Allowances Us-17(3) Exemption-Salary
Tax Amendment-2015 Taxable Income
Clubing of Income Tax Deductions
HUF Deduction HUF Investment
Gift by HUF HUF Tax Planning Tips
Tax Saving Schemes Tax Planning Tips
Refund of Tax Fringe Benefit Tax-FBT
Return Filing Assessment / Scrutiny
Notice from I.T. Dept. Incomes Types @ TDS
Exemptions-Tax Returns “Summon” U/s 131
'Black Money' @ I.Tax Big Gifts To Be Taxed
'Appeals' under I.Tax Assessment @ I.Tax
Exempted Incomes Capital Gain
Business & Professions House Property
Salaries @ I.Tax Partnership Firm
'Penalty' under I.Tax Act. Tax Ready Reckoner
Charitable Trust Useful Links @ I.Tax
 
Guide & FAQ on Tax Knowledgebase @ Taxation Income Tax @ Glance HUF - Formation, Planning & Taxation
TRUSTs (Formation, Management & Taxation) NRI (Tax Planning,Saving,Investemnt)    

Disclaimer:
All efforts are made to keep the content of this site correct and up-to-date. But, this site does not make any claim regarding the information provided on its pages as correct and up-to-date. The contents of this site cannot be treated or interpreted as a statement of law. In case, any loss or damage is caused to any person due to his/her treating or interpreting the contents of this site or any part thereof as correct, complete and up-to-date statement of law out of ignorance or otherwise, this site will not be liable in any manner whatsoever for such loss or damage.

The visitors may click here to visit the web site of Income Tax Department for resolving their doubts or for clarifications

 
Contact Us :

SWAYAM EDUCATION
Mandal Bagicha, Hemkapada,
Sunhat, Balasore-756002 ( Odisha)
eMail ID : incometaxmanagement@gmail.com

www.IncomeTaxManagement.Com